The ABS said the value of completed construction in Australia is down 1.5 per cent over the year. Photo: Erin Jonasson

On a seasonally-adjusted basis, the drop was of 1.2 per cent for the quarter and 0.6 per cent year-on-year.

This statistics provide an early indication of trends in building and engineering construction activity, and are based on data covering about 85 per cent of all activity. They form an important part of the national accounts' estimates of fixed capital formation.

The latest series underlines concerns voiced again last week by Reserve Bank of Australia governor Glenn Stevens, that private sector investment has so far been insufficient to offset the sharp decline in construction activity since the end of the mining infrastructure boom.

As expected, the biggest fall in activity was seen in engineering, which reflects the end of this boom. The value of completed engineering works for the quarter was $29.8 billion, down 3.1 per cent on the March quarter and 6.5 per cent compared with the same three months last year.

On a seasonally-adjusted basis, the falls were 3.1 per cent again and 5.6 per cent year-on-year.

This fall-off in the value of engineering works was partly offset by completed residential building, which at $13.4 billion was up 3.6 per cent compared with the March quarter and nearly 10 per cent over the year. Seasonally-adjusted, the increase was 2.2 per cent and 9.6 per cent.

Non-residential building was weak, down 0.2 per cent on the quarter and ahead 1.6 per cent on the year. On a seasonally-adjusted basis, however, it was ahead 0.5 per cent and 2.9 per cent for the year.